PURCHASE AND INVESTMENT AGREEMENT
_____________, 1999
The following will constitute the agreement between XxxXxxx.xxx, Inc.
("Company") and the undersigned (the "Purchaser") with respect to the
Purchaser's investment in the Company.
1. Purchaser hereby purchases from the Company __________ shares of the
Company's Common Stock, $.001 par value, (the "Shares") at a price of $3.00 per
share, for a total purchase price of $_________ (the "Purchase Price").
2. The Company shall deliver to Purchaser a certificate representing the
Shares, registered in the name of Purchaser, within five (5) business days after
Purchaser shall have paid to the Company the full Purchase Price.
3. Purchaser represents, warrants and covenants to the Company and each of
its officers, directors, persons who control the Company and any affiliates of
the foregoing that:
a. Either (i) Purchaser is a director or executive officer of the
Company, (ii) Purchaser has a net worth, inclusive of the value of Purchaser's
homes, home furnishings and automobiles, of at least $1,000,000 (which net worth
may include the Purchaser's spouse's net worth), (iii) Purchaser's individual
income for each of the past two calendar years exceeded $200,000 and Purchaser
reasonably expects Purchaser's individual income to exceed $200,000 in the
current year, (iv) Purchaser's income together with the income of Purchaser's
spouse for each of the past two calendar years exceed $300,000 and Purchaser
reasonably expects Purchaser's income together with that of Purchaser's spouse
to exceed $300,000 in the current year, or (v) the Purchaser has such knowledge
and experience in business and financial matters that Purchaser is capable of
evaluating the merits and risks of an investment in the Company.
b. Purchaser is acquiring the Shares for Purchaser's own account,
for investment only and not with a view toward the resale or distribution
thereof.
c. Purchaser understands that the Shares are not registered under
the Securities Act of 1933 (the "1933 Act") and may not be resold unless
subsequently registered under the 1933 Act or unless an exemption from such
registration is available. Purchaser understands that the Shares have not been
approved or disapproved by the Securities and Exchange Commission (the
"Commission"), or any other federal or state agency, nor has the Commission or
any such agency passed upon the accuracy or adequacy of any of the information
provided to Purchaser. Purchaser agrees that Purchaser will not attempt to
dispose of Purchaser's Shares or any interest therein, unless and until the
Shares have been validly registered with the Commission, or the Purchaser has
given the Company at least thirty (30) days prior written notice of such planned
disposition and the Company has determined that the intended disposition does
not violate the 1933 Act or the rules and regulations of the Commission
thereunder (the Company may rely on an opinion of its counsel in making such
determination).
d. The Purchaser has adequate funds to provide for the Purchaser's
personal needs and does not and will not require the funds comprising the
Purchase Price for liquidity purposes. The Purchaser possesses the ability to
bear the economic risk of holding the Shares indefinitely and can afford a
complete loss of the investment contemplated hereby.
e. In making Purchaser's investment in the Shares, no oral
representations or warranties have been made to Purchaser. Purchaser
acknowledges that Purchaser has been advised that, except for Mr. Xxxx Xxxxx and
Xx. Xxxx Xxxxxx, no person is authorized to give any information or to make any
statement regarding the Company's Strategic Business Plan and the attachments
thereto (the "Business Plan"), and that any information or statement not made by
such persons must not be relied upon as having been authorized by the Company or
any professional advisors or counsel thereto. Purchaser acknowledges that the
Company makes no representations or warranties, expressed or implied, with
respect to the completeness or accuracy of the Business Plan as to its contents
or any other written or oral communication transmitted or made available to
Purchaser or Purchaser's representatives, and that Purchaser and Purchaser's
representatives must rely on their own due diligence of the Company and their
own independent verification of the information provided in the Business Plan
and any other investigations deemed necessary for the purpose of determining
whether to proceed with the investment in the Company. The Business Plan
includes certain statements, estimates and projections provided by the Company
with respect to anticipated future performance of the Company. Such statements,
estimates and projections reflect various assumptions by the Company's
management concerning anticipated results, which may or may not occur. No
representations are made as to the accuracy of such statements, estimates, or
projections, and actual performance of the Company may be materially different
from those set forth in such statements, estimates or projections.
f. Purchaser has reviewed, carefully read and completed the Investor
Questionnaire attached as Exhibit A hereto. All information provided by
Purchaser to the Company, including that contained in the Investor Questionnaire
submitted herewith, is true and correct in all respects as of the date hereof.
g. The address set forth below is the Purchaser's true and correct
residence. Purchaser has no present intention of becoming a resident of any
other state or jurisdiction.
h. Purchaser covenants that the foregoing representations and
warranties will be true and accurate as of, and acknowledges that such
representations and warranties shall survive, the date of his or her purchase of
the Shares.
i. Purchaser is aware that all documents, records and books
pertaining to this investment are at all times available at the offices of the
Company at Xxx Xxxxxxxxx Xxxxx, Xxxxxxxxx, Xxx Xxxx 00000, or at the offices of
the Company's counsel, Rosenman & Colin LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn: Xxxx X. Xxxxxx, Esq., and acknowledges that all documents,
records and books pertaining to this investment requested by Purchaser,
including without limitation, the Company's unaudited financial statements as of
December 31, 1998 and for the year then ended, (a copy of which is attached as
Exhibit B hereto) and capitalization chart (a copy of which is attached as
Exhibit C hereto) have been made available to the Purchaser and the persons the
Purchaser has retained, if any (if applicable, such person is _________ having
an address at ______________________________) to advise Purchaser with respect
to this investment (and if any such person has been retained, such person has
provided to the Company a completed Purchaser Representative Questionnaire in
form and substance satisfactory to the Company), and the Purchaser and such
persons have been supplied with such additional information concerning this
investment as has been requested.
j. The Purchaser has been given the opportunity to discuss the
Purchaser's investment in, and the operation of, the Company with the Company's
management and has been given all information that the Purchaser has requested
and which the Purchaser deems relevant to the Purchaser's decision to invest in
the Company.
4. Purchaser agrees that the certificates evidencing the Shares shall bear
the following legend restricting their transferability under the Act:
2
LEGEND
THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("ACT"). NO SALE, OFFER TO SELL OR TRANSFER OF THE SHARES REPRESENTED BY
THIS CERTIFICATE SHALL BE MADE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SHARES UNDER THE ACT, OR AN OPINION OF COUNSEL TO THE
COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT.
5. Purchaser shall indemnify and hold harmless each of the Company, its
directors, officers, persons controlling the Company, any affiliate of the
foregoing or any professional advisors thereto, from and against any and all
loss, damage, liability or expense, including costs and reasonable attorneys'
fees, to which any of them may be put or which they may incur by reason of or in
connection with any misrepresentation made by Purchaser, any breach of any of
Purchaser's warranties of Purchaser's failure to fulfill any of Purchaser's
covenants or agreements under this Agreement.
6. (a) This Agreement shall be governed by and construed in accordance
with the internal laws of New York (without giving effect to the conflict of
laws rules thereof) applicable to contracts, transactions and obligations
entered into, and to be wholly performed, in New York.
(b) This Agreement contains the entire agreement between the parties
hereto with respect to the subject matter thereof. The provisions of this
Agreement may not be modified or waived except in writing and signed by both
parties hereto.
(c) This Agreement and the rights, powers and duties set forth
herein shall, except as set forth herein, bind and inure to the benefit of the
heirs, executors, administrators, legal representatives and successors of the
parties hereto. Purchaser may not assign any of his rights or interests in or
under this Agreement without the prior written consent of the Company, and any
attempted assignment without such consent shall be void and without effect.
(d) This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original and all of which taken together shall
constitute a single agreement.
3
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
XXXXXXX.XXX, INC. PURCHASER
By:__________________ __________________________
Name: Xxxx X. Xxxxx Name:
Title: President
Address:__________________
__________________
Soc. Sec. No. ____________
4
